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The Johan Sverdrup Oil Field development has been given the green light and major contracts have been awarded. Johan Sverdrup is among the largest oil fields on the Norwegian shelf, and will at peak contribute with 25% of the production from the Norwegian shelf.

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Introduction

Ethiopia is currently not a producer of oil or natural gas, but as with many of its regional neighbours, it is seeing a growing level of interest from exploration companies

It is believed that there are reasonable reserves of hydrocarbons to be exploited, but security issues have caused the exit of Petronas, raising questions of how these resrves can be developed.

History

2009 - Africa Oil aquired assets from Swedish company Lundin

2010 - Tullow signed an agreement with Africa Oil to gain a 50% operated interest in the South Omo Block in Ethiopia.

Regulation

The Ministry of Mines is responsible for regulating the sector

Upstream

There are currently no producing wells in the country, but there are a number of promising areas being explored

It is believed by the Ethiopian Ministry of Mines and the Petronas Joint Study that the two most promising hydrocarbon areas in Ethiopia are the Gambella Basin (in the southwest bordering Sudan) and the Ogaden Basin (in the southeast).

The Gambella Basin is believed to be geologically analogous to south-eastern Sudan. In June 2003, Petronas invested approximately USD100 million to explore the Gambella Basin

The Ogaden Basin covers 350,000 sq km and is the largest proven hydrocarbon bearing sedimentary basin in Ethiopia. There are two large gas discoveries in the basin which contain estimated reserves of approximately 3Tcf (Calub and Hillala).

The Ogaden Basin was recently subjected to an exclusive Basin-wide joint study by Petronas with the Ethiopian Ministry of Mines. The 22-month joint study concluded in April 2005, and Petronas subsequently sought to license a majority of the 22 exploration blocks in the Ogaden Basin.

Active Companies

Africa Oil has three projects in Ethiopia consisting of blocks 7 & 8 in the Ogaden Basin of eastern Ethiopia, the Adigala Block close to the border with Somalia and Djibouti and the South Omo Block which lies in the Omo Rift Valley of south-western Ethiopia.

In 2010, Tullow signed an agreement with Africa Oil to gain a 50% operated interest in the South Omo Block in Ethiopia.

Afren has a net working interest of 30% in two licenses consisting of four blocks (Blocks 2 and 6, and Blocks 7 and 8) located in the Ogaden Basin of Eastern Ethiopia